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With the Dow hitting a new all-time high along with the Nasdaq, we have extreme stock market bullishness, record shorts in the VIX and QE going in reverse. Interesting times. Plus a surprising look at what is happening with inflation…

Metals Hitting Multi-Year Highs
By Peter Boockvar, author of the Boock Report
October 16 (King World News) – Here is what Peter Boockvar wrote as the world awaits the next round of monetary madness: Just as central bankers in DC over the past week mused over the mystery of inflation, commodity prices continue higher. Copper is ripping up by more than 2% to a 3 year high and up for a 6th straight day. Nickel prices are higher for a 7th straight day. Palladium is trading at a 16 year high. Also rallying is tin, aluminum, lead, platinum and silver…

This move comes after China reported a 6.9% y/o/y rise in PPI in September, above the estimate of up 6.4% and vs 6.3% in August. As for the factors, it’s partly demand but also the perception that supply continues to get cut. Outside of China over the past two years there has been a sharp decline in mining investment while in China it’s difficult to gauge what the net result is of their cuts in capacity because many times it is offset by new, more updated production. It seems that inefficient and old capacity in China is what is getting cut, in part to the government mandate on cutting pollution. Bottom line, inflation is not dead.